Market Commentary

Daily reports from our Chief Economic Strategist.

A HUGE SURPRISE IN DECEMBER’S RETAIL SALES
Initial data indicate retail sales fell by 1.2% in December from the previous month, the most since 2009. Most had expected an increase. What is even more confusing there was a pullback in a measure based largely on internet sales, which had been expected to
RUBIO’S TWEET, THE GCC AND THE CPI
Equities partially reversed course following a tweet from Senator Rubio that his introducing a bill to tax stock buybacks and equal footing with dividends. I recall reading about his proposal several days earlier in a report talking about how stock buybacks is greater than the amount
TODAY IS INDEED TECTONIC
Many times I have commented that today is tectonic. Geopolitically I believe current events are similar to eras as to when the Soviet Union dissolved in 1991 or the ascension of the US as a primary global power in 1946. The EU is in shatters. It is increasingly apparent that this grand project is failing and this uneven and over ambitious expansion has weakened not strengthened the EU. The euro is potentially
SOCIAL MEDIA, NEWS AND ADVERTISING
Many times I have commented life is stranger than fiction. Yesterday’s WSJ commented that over two thirds of Americans receive their news from social media. Google and Facebook control a large majority of the digital advertising market that used to be a major source of revenue for the
PROJECTED EARNINGS WERE AGAIN REVISED DOWN
Equities came under moderate pressure on growth and trade concerns. Moreover first quarter S & P 500 earnings projections were revised lower to a 2% decline versus a 1% drop forecasted a week ago. At year end results were anticipated to rise by 3% for the period. For all of 2019 profits are now projected to grow by
THOUGHTS ABOUT TAX CUTS, THE FEDERAL DEFICIT, VIRGINIA’S POLITICS AND SOCIAL MEDIA
Perhaps one of the biggest elephants in the room that is not discussed is the federal deficit. In my view, the issue at hand is spending not revenues. Generally speaking, spending is increasing at a rate two times greater than revenues. Tax revenues are at an all-time record and are expected to
A RELATIVELY QUIET DAY
Equities fluctuated on volume about 15% lower than average. The S & P 500 broached the 200 day moving average for the first time since early December. Earnings and economic data were mixed. Speaking of earnings, analysts are now
WILL THE STRENGTH OF THE DOLLAR BECOME A SIGNIFICANT HEADWIND?
Fourth quarter earnings season is at its halfway point. Of the 234 S & P 500 companies that have posted results, 71% have exceeded forecasts rising by an average of 18%. Historically 64% of firms exceed expectations. At the conclusion of the season, profits are expected
ALWAYS EXPECT THE UNEXPECTED
The FOMC said it will be “patient” on any future interest rate moves and signaled flexibility on the path for reducing its balance sheet, a substantial pivot away from its bias just last month towards higher borrowing costs.
A RELEIF FROM APPLE…FED, MICROSOFT AND FACEBOOK UP NEXT
Apple posted results that narrowly beat the expectations set when Apple issued a rare earnings warning at the beginning of the month. However its outlook for the current quarter is regarded more disappointing than some were expecting. At the time of this writing shares are

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